2. Contact Information
Mark J. McGaunn, CPA/PFS, CFP®
Managing Member
McGaunn & Schwadron, CPA’s, LLC
75 2nd, Avenue, Suite 425
Needham Heights, MA 02494-2897
main (781) 489-6651
direct (781) 348-9227
e-fax (781) 479-5985
e-mail mark@mcgaunnschwadron.com
web: www.mcgaunnschwadron.com.com
3. Discussion Points
• Protocols
• Multi-Branding Strategies
• Standards of Accreditation
• Professional Certifications
• Cost Segregation Study
• Balanced Scorecard/Benchmarking
4. Protocols
Different professions have their own definition.
From Houghton Mifflin Dictionary, defined as:
– Forms of ceremony and etiquette observed by
diplomats and heads of state,
– Code of correct conduct: safety protocols;
academic protocol, etc., or
– Plan for a course of medical treatment or for a
scientific experiment.
5. Why, Why, Why?
• Franchise business owners know their
success came easier as someone prior to
them took the time to IDENTIFY and
DOCUMENT each and every business
process to secure success.
• Written protocols protect against the bus
coming!!!
6. The Protocol Process
1. Identify the processes in areas of
practice responsibility.
2. Break each process into smallest pieces.
3. Solicit team member input.
4. Document/Revise/Follow/Improve
5. Repeat 3 and 4 continuously
7. RETAIL MANAGEMENT TRAINING PLAN
– Brand Training & Orientation
– In-Store Evaluation
– Integrated Brand Training (Combo/Trombo)
– “Servsafe “
– Cake Decorating
– Production Training
– Shift Leader Training & Certification
– Basic Management Training
– Human Resource Training
– Store Management Training
– Franchisee Business Course
8. Symptoms-rapid HR >150 bpm with A-Flutter/A-Fib on 12 Lead EKG.
Treatment-If patient hemodynamically unstable with decreased LOC
:
• Sedate with Diazepam, 2-5 mg increments, SIVP as appropriate up
to a total dose of 0.2 mg/kg).
• If Atrial Fibrillation-Synchronized cardioversion at:
Standard 100 joules; proceed to 200, 300, 360 joules.
Zoll Biphasic 30 joules; proceed to 50, 75, 100, 120, 150, 200 j.
• If Atrial Flutter- Synchronized cardioversion at:
Standard 50 joules; proceed to 100, 200, 300, 360 joules.
Zoll Biphasic 10 joules; proceed to 20, 30, 50, 75, 100, 120,
150, 200 joules.
• If patient is hemodynamically stable w/severe CP or SOB
see Chest Pain/CHF protocols.
Albuquerque Paramedic Protocol AC-4 for
Atrial Fibrillation & Atrial Flutter treatment:
9. Multi-Branding Strategies
The process of incorporating two or more partners in a
location.
Examples in the franchise food industry:
1. Bain Capital’s Dunkin Donuts, Baskin Robbins ice
cream stores, and Togo’s sandwich stores. 53% of
all new Dunkin Donuts locations are multi-branded
units.
2. YUM! Brands varies combinations of Taco Bell,
Pizza Hut, KFC, A&W and Long John Silvers
10. Multi-Branding Benefits
• Consumer perception of satisfaction greatly improved
when multiple brand choices under one roof
• Two brands occupying same location save on facility
purchase and occupancy costs.
• Multi-branded restaurants in YUM! family have higher
average unit sales volumes and cash flow than singles
• Multi-branding in the franchise arena experiences
greater local capture when each brand has a
complementary “day-part” (breakfast, lunch, dinner)
orientation.
11. Multi-Brand Challenges
• A sacrifice of identity and possible confusion
when different brands share locations.
• Duplication of equipment/staffing=higher costs.
• Staffing difficult if both brands share employees.
• Some brands are just no meant to go together.
• Multi-branding cannot be used to hide
operational, brand or menu problems.
12. Services work in vet practices!
Multi-branding strategies can consist of complementary
ancillary services owned by separate, unrelated entities
sharing the same physical location such as:
• Kennels, boarding, grooming, day/”date” care
• Veterinary pharmacies (compounding focus)
• Specialty medicine
• Rehabilitation facilities
• Alternative therapy practices
• Retail facilities
• Crematorium (rather “funeral home”)
• Diagnostic imaging
• Obedience training
• Behavioral Counseling
13. National Examples
• Some retail providers have employed a multi-
branding strategy
• But usually one predominant entity in the strategy
• Ancillary service providers are subject to
significant operating restrictions.
Practice owners who enter into multi-branding
agreements should strive to have equal
representation for optimal functioning.
14. Standards of Accreditation
• Companies of all sizes strive for recognized
accreditations for growth.
• ISO’s (International Organization Standards) are
voluntary technical agreements which provide
the framework for compatible technology
worldwide. Manufacturing businesses spend
significant time, effort and money to obtain ISO
9000 and ISO 14000 certifications.
• Enables them to better participate in
international trade.
15. Franchise Example
Dunkin Donuts uses their own internal, proprietary
accreditation models to evaluate store compliance with
company financial, operational, and customer service
objectives. The parent entity regularly reviews a
franchisee’s:
1. Written systems in place covering all areas of
business operations (customer service, HR,
training, management)
2. Formal Business Plan (historical and projected)
3. Growth Plan (territory additions, outside
expansions, etc)
16. 1. “A” –company allows you to do whatever you wish
within territory & provide you with CEO’s cellphone #
1. “B” –company places a “development hold” on any
growth plans and CEO places a block on his cellphone
number
2. “C” –company forces franchisee into a transition phase
of improvement or else they change the locks on your
door!!!!
Not many second chances are given…
Dunkin Donuts Rating System
17. • Joint Commission on Accreditation of Healthcare
Organizations (JCAHO) evaluates and accredits 15,000
health care organizations and programs in the US.
• Independent and predominant accrediting body in U.S.
health care. Organizations must undergo on-site survey
by a JCAHO survey team at least every three years.
• May make unannounced evaluation visits (by request or
complaint).
18. • High 5’s Project: Established in 2007 to
implement innovative, standardized operating
protocols for 5 patient safety solutions over 5
years. Leverage solutions that would have broad
impacts in preventing avoidable catastrophic
adverse events such as death or serious injury
in hospitals.
• Prevention of patient care hand-over errors
• Prevention of wrong site/wrong procedure/wrong
person surgical errors
• Prevention of continuity of medication errors
19. American Animal Hospital
Association (AAHA)
• International association of more than 33,000 veterinary
care providers who treat companion animals.
• AAHA Standards of Accreditation are benchmarks of
excellence to raise the care levels provided. Over 3,000
veterinary hospitals voluntarily participate in AAHA
hospital evaluation program. (but only 15% of US and
Canadian total practices)
20. AAHA Benefits
• Standards are not a punitive measure but a set
of guidelines to raise, maintain, and improve
veterinary care to or above accepted practice
standards
• Tools are already in place to assist vets
• Evaluations and care guidelines are an easy
way to obtain advice on designing protocols and
a framework for operations (see Hazardous
Materials, Imaging, Dental Care Guidelines)
21. AAHA Perspective
• Practices that choose to become AAHA-accredited
typically want an objective, third-party review of their
practice to ensure that they are meeting or
exceeding high standards of medical delivery, utilize
cutting-edge management, and recognized as such.
• Dr. John Albers, former AAHA Executive Director,
“Just let us come in to see if what you say is really
going on truly is.”
22. AAHA Problems?
• Within a 50 mile radius of my office, there are only 51
AAHA-accredited practices (including 2 in Boston).
• One complaint-public does not recognize, or even know
about, the differentiation factor among haves & have
nots.
• Some fault attributed to practices themselves for not
using all kinds of patient contact (ads, video, DVM and
staff) to publicize the AAHA standard.
• Some may be institutional-”Build it and they will come.”
(but who will come?).
23. Professional Certifications
In certain fields of professional study, there are
individual achievements that denote technical
competence. For example:
• DVM (Doctor of Veterinary Medicine)
• MD (Doctor of Medicine)
• CPA (Certified Public Accountant), and
• JD (Doctorate of Jurisprudence)
• CFP® (Certified Financial Planner™)
24. Professional Certifications
• But once you or your staff attain a certain level
or designation, are you all “educated out”?
• Franchisees in different industries have a
multitude of distance learning and on-site
programs to keep regular, third-party training in
force (as opposed to “train-the-trainer”
approaches)
• See how some franchise operators keep up in
their own industry
25. • Nation's largest retail provider of prescriptions
operating 7,008 pharmacies and 560 Minute Clinics in
43 states to fill over 1 billion prescriptions annually.
• Employs 20,000 pharmacy technicians who serve as
primary contacts daily for hundreds of thousands of
customers. CVS pharmacy technicians:
1. verify insurance and billing information
2. note customer medication/product preferences
3. direct customer inquiries to pharmacists,
4. handle many among other duties.
26. Training Problems
• Pharmacy technician training materials were not
used consistently by each location.
• Most instruction given via unstructured “OJT”
• CVS/Caremark centralized and standardized its
pharmacy practices and workflow, including using
the THINQ Training Server Learning Management
System (LMS), a web-based, distance-learning
format integrated with CVS/Caremark’s testing and
assessment information.
• Huge success, promotes uniform & regular training
schedules.
• Beats a 100% “lunch and learn” program hands
down!
27. John Deere’s Initiative
Problem
Lack of qualified personnel who could take
charge and lead a John Deere Dealership.
Result
Formation of the John Deere Dealership
Management Program, a cooperative
partnership between John Deere and the
University of Missouri’s College of Agriculture,
Food and Natural Resources.
28. Learning paths on John Deere University’s web-based
program provide a blueprint for continuing education in
each functional area and are divided into five training
courses:
– Core (i.e. Hydraulic Certification)
– Selling & Marketing (i.e. Partnering for Customer
Value)
– Resource Utilization (i.e. Service Advisor Certification)
– Product Application (i.e. Air Conditioning Systems)
– Management
Advanced & Master Certifications are given-need 16
credits (4 days) for annual recertification
29. Other Certifications You’ve Seen?
The Funny Ones
• CBT (Certified Bagel Technician-yes, on Cape Cod)
• CASIT (Certified Auto Sound Installation Technician)
The Elusive Ones
• 106 AVMA diplomates in Dentistry
• 48 AVMA diplomates in Pharmacology (+5 since 2004)
30. DVM Specialty Designations
Only 9,826 AVMA recognized board-certified diplomates as
of December 2009. Great achievement, the combining of
various specialties can only bring patient care geometric
dividends.
Anesthesiologists 185
Behaviorists 46
Dentists 106
Canine & Feline Practitioners 459
Internal Medicine Small Animal 1,022
Emergency and Critical Care 293
Pharmacology 48
Radiologists 365
Veterinary Surgeons 1,279
Animal Behaviorists 46
Nutrition 54
31. New Certification Ideas
Other areas for veterinary practitioners to acquire
knowledge themselves or to have staff gain talents:
– UC Davis School of Veterinary Medicine has a one-
year residency in clinical veterinary pharmacy that
provides practical training in the principles of animal
medicine for graduates of accredited human schools
of pharmacy.
– Some veterinary practices are now employing human
pharmacy-trained technicians to staff their own
veterinary pharmacy in a fully-dedicated model
patterned after human pharmacies.
– Practices could form joint “training” ventures among
area practices to upgrade training and share ideas.
32. Cost Segregation Study
• A comprehensive engineering-based analysis of
the total cost or value of building and site
improvements.
• Allows building owners to re-allocate Code Sec.
1250 (real property depreciated over 39 years)
to Code Sec. 1245 (personal property
depreciated over 5 to 15 years).
• Results in increased depreciation deductions.
• Generally, the more specialized and unique an
asset is, like a veterinary practice facility, the
greater the tax benefits derived.
33. Kudo’s Judge Billing
Learned Hand!
(January 27, 1872 – August 18, 1961)
• Cost Segregation results need to be disclosed to
the IRS by the taxpayer filing Form 3115 (Change
of Accounting Method).
• IRS Revenue Procedure 2004-11 allows property
owners to retroactively catch-up on missed
depreciation on assets owned back to 1987 with
a one-time catch-up provision under an IRC
Section 481(a) adjustment, precluding
preparation of amended tax returns.
34. Saved by 1997 Tax Court Case!
Hospital Corp. of America v. IRS Comm’r
• Defines the nebulous “permanence” issue
regarding tangible personal property.
• Court concluded that property, which qualified
as tangible personal property for investment tax
credit purposes under pre-1981 case law also
qualifies as tangible personal property.
• Different tests are used to determine whether an
asset is an inherently permanent structural
component or tangible personal property.
35. 3 Essential Steps…
IRS specifies:
1. written "cost segregation study" for legal basis
2. "logical and objective measure" to support "tangible
personal property”
3. study not based upon "non-contemporaneous
records, reconstructed data, or taxpayer estimates
or assumptions that have no supporting records."
36. Overview
• What is a cost segregation study (CSS)?
Engineering-based analysis of property investment
Accelerate depreciation deductions
- Typically from 39-year to 5, 7, 15 lives
Interior elements include special-use electrical, cabling,
plumbing and HVAC systems, front desk, cabinetry and other
millwork, some wall coverings and floorings, animal cages,
sound systems, etc to 5-year
Outdoor components normally include paving, sidewalks,
curbing, lighting, fencing, signage, landscaping, water
detention, retaining walls, some utilities, etc to 15-year lives
37. 2 Types of Cost. Segs
1. Free-standing facilities which average 18%
reclassification from 39 year to 15 year property and
20% from 39 year to 5 year property. Projected tax
benefits average $81,000.
2. Large retail practice facilities (mall locations) which
average $650,000 in build-out costs. 35% of costs
can be reclassified from 39 year to 5 year property
generating $52,325 in estimated tax benefits.
38. One Dunkin Donuts Location
Cost segregation plan for $1.3 million facility
purchase shows $346,000 allocation to 5yr and
15yr assets
CY Depreciation Deductions:
Pre-study $ 17,000
Post-study $ 48,000
add’l deduction $ 31,000
39. % Impact on Asset Base
0%
0%
58%
42%
5 Year 15 Year 39 Year Land
11%
16%
31%
42%
5 year 15 Year 39 Year Land
Now 27% of total assets are reclassified to 5 & 15 yr property!
40. Tax Strategy-Fed & State
• Reallocated: $1,245,671 (44.6%)
• 1st Year Tax Savings: $77,000+
• 10-Year Tax Benefit: $286,000+*
*represents the 10-yr. NPV savings using an 8% discount rate.
Veterinary New
Construction
Cost of $2,793,471
42. Do Cost Segregation Studies When??
• Best performed:
Preferably immediately after new building construction
New acquisition of property (or change in estate)
Look-back – owned property for years but now in position
Following major capital improvements (including leaseholds)
• Buildings placed in service after 2000
• Look-back to “missed” depreciation – HUGE first year benefit
• Property basis at least $750,000
• Should not do when property to be sold less than 2 years after study.
• Client is profitable and could benefit from a large tax deduction.
43. Balanced Scorecard/Benchmarking
• Franchise owners and chain management have
utilized benchmarking to highlight financial strengths
and weaknesses in store-to-store and intra-store
measurements.
• But the true progressives utilize intra-entity
benchmarking and metrics to measure their
progress.
• Financial metrics are typically only a component.
• Customer Service is measured in all aspects.
• But how can we be cutting edge?
44. Balanced Scorecard
• Robert Kaplan and David Norton developed a
technique called the Balanced Scorecard in 1997.
• Process integrated strategy execution, performance
management, and facilitated organization learning.
• Kaplan argued traditional benchmarking based on
production and financial indicators provided limited
insight into business’s key strategies and that
comparisons were generally made to the average of
a group of practices.
• Perfect for situations such as lack of focus or
direction, a new strategy, or a need to achieve
organizational alignment to a common vision.
45. Balanced Scorecard
A Balanced Scorecard approach helps practices develop
primary goals directly from a mission statement, practice
vision, and defined critical business strategies to
implement your practice vision. The approach takes a
pulse of:
– the financial and non-financial measures of your
practice,
– its leading and lagging indicators,
– employee and patient satisfaction, and
– short- and long-term strategy.
Kaplan’s approach utilizes a strategy map (the
“Scorecard) to develop a practice’s key strategies. The
map shows cause and effect linkages between the
various parts of the strategy.
46. Sample Scorecard
Objective
Key
Performance
Measure
Target Initiatives
Encourage
compliance with
AAHA dental
screening
recommendations
over current 30%
standard
Percentage of
patients
compliant with
semi-annual
screenings
100% DVM
recommended
(PMS review)
Compliance
Year 1-45%
Year 2-60%
Year 3-75%
-Implement
PetCare TV
dental programs
in waiting areas
-Document!!!
-Develop staff
communication
plan (DVM, tech,
kennel, recept.,
other)
47. Key Points To Incorporate
• Develop strategic objectives incorporating each of the
following perspectives: Financial, Customer, Internal Process,
and Learning and Growth.
• Team members directly affected by the vision should be
involved.
• Develop both leading and lagging indicators for each of the
above strategic objectives, agreed to by team members.
• Responsibility s/b assigned to someone for completion of the
initiative developed.
• Provide regular progress reports (charts, graphs and reports)
• Provide meaningful feedback to employees on
accomplishment with incentives to reward achievement.
A special thanks to Elizabeth Bellavance, DVM
for her expert knowledge on the Balanced Scorecard!
49. Contact Information
Mark J. McGaunn, CPA/PFS, CFP®
Managing Member
McGaunn & Schwadron, CPA’s, LLC
75 2nd, Avenue, Suite 425
Needham Heights, MA 02494-2897
main (781) 489-6651
direct (781) 348-9227
e-fax (781) 479-5985
e-mail mark@mcgaunnschwadron.com
web: www.mcgaunnschwadron.com.com